London-based companies may need to move chunks of their business — but which cities in the EU will benefit most?

On a rainy June morning in Paris, five dozen men and women gathered in a basement in La Défense, the city’s financial district. Over bitter coffee and fluffy croissants, the great and the good of French politics, business and finance had gathered to plot a heist.

What will Brexit mean for the City of London? Whatever terms Britain manages to negotiate with the other 27 member states, countries across the EU are eager for a bigger bite of the financial services sector that the City enjoys the lion’s share of today, say Financial Editor Patrick Jenkins and FT reporters. The big question is which rivals are likely to benefit most.

With two weeks to go before the Brexit vote, they wanted to be ready with a sales pitch to lure the international financial groups based in London, should Britain vote to leave the EU. Now, they reasoned, any company with pan-European aspirations would be compelled to move jobs, business lines, even headquarters out of London.At the time hardly anyone seemed to believe that the UK electorate would really vote to leave. But that didn’t stop the Parisien elite. Jean-Louis Missika, a deputy mayor of Paris, promised he would be “rolling out the red carpet” to bankers if Brexit happened. Gérard Mestrallet, head of the Paris Europlace lobby group, says this was “the moment” for Paris as a financial centre.It is a dramatic turning of the tables. Four years ago, Boris Johnson, the then London mayor turned Brexit frontman, who said on Thursday he would not enter the race to be next Conservative prime minister, was goading Paris for the “tyranny and terror” of its rich-soaking tax policies and inviting French bankers to escape to London. “Vous êtes tous bienvenus,” he boomed.This time it is Paris that is appealing to bankers in London with a “Welcome to Europe” slogan.The French charm offensive has been notably aggressive, but they are not alone. Frankfurt and Dublin — and a long list of others from Luxembourg to Warsaw — are now clamouring to appeal to the banks, insurance companies and asset managers for whom using the City of London as a single European hub may no longer be sensible. And where those financial services groups go, a whole host of ancillary roles — in law, accountancy, consultancy and the rest — will follow. Tens of thousands of jobs, out of nearly half a million in the City, could be at risk, financiers estimate.

The sales pitch is simple. If the UK is outside the EU, financial services companies will be stripped of the “passporting” rules that allow them to operate across borders without local licences. Those companies will need instead to think about a new EU base. The City, which has grown and globalised since the Big Bang deregulation reforms 30 years ago, would shrink and deglobalise.Not everyone buys the argument. Some contend the City has an even brighter future as a centre focused less on Europe — excelling, for example, in offshore renminbi trading and financial technology. In any case, bullish British lawyers reckon that UK negotiators will be able to strike a deal to extend passporting. If that proves politically impossible, they point to new rules, under the so-called Mifid II rule book that comes into force in 2018. These should give any non-EU country with “equivalent” financial rules access to the single market on level terms.One snag is the risk of an EU country — like France — sensing a competitive opportunity and seeking to have the rules tweaked to disadvantage the UK.Even if a good deal is reached, says Simon Gleeson, a lawyer at Clifford Chance who advises many of the big banks, it may be academic. “Banks [will] have to write their contingency plans before they know the [political] situation that will exist in the future.” In other words, a bank may need to decide to shift chunks of its business to more secure EU locations, regardless of what politicians manage to negotiate.

The world is entering a period where once-robust democracies have grown fragile. Now is the time to figure out where we went wrong.

By Stephen M. Walt.

Once upon a time — that is, back in the 1990s — a lot of smart and serious people believed liberal political orders were the wave of the future and would inevitably encompass most of the globe. The United States and its democratic allies had defeated fascism and then communism, supposedly leaving humankind at “the end of history.” The European Union seemed like a bold experiment in shared sovereignty that had banished war from most of Europe. Indeed, many Europeans believed its unique combination of democratic institutions, integrated markets, the rule of law, and open borders made Europe’s “civilian power” an equal if not superior counterpart to the crude “hard power” of the United States. For its part, the United States committed itself to “enlarging the sphere of democratic rule, getting rid of pesky autocrats, solidifying the “democratic peace,” and thereby ushering in a benevolent and enduring world order.As you’ve probably noticed, the heady optimism of the 1990s has given way to a growing sense of pessimism — even alarm — about the existing liberal order. The New York Times’s Roger Cohen, a thoughtful and committed liberal, believes that “the forces of disintegration are on the march” and “the foundations of the postwar world … are trembling.” An April white paper from the World Economic Forum cautions that the liberal world order “is being challenged by a variety of forces — by powerful authoritarian governments and anti-liberal fundamentalist movements.” And in New York magazine, Andrew Sullivan warns that the United States itself may be imperiled because it has become “too democratic.”

Such fears are understandable. In Russia, China, India, Turkey, Egypt — and yes, even here in the United States — one sees either resurgent authoritarianism or a yearning for a “strong leader” whose bold actions will sweep away present discontents. According to democracy expert Larry Diamond, “between 2000 and 2015, democracy broke down in 27 countries,” while “many existing authoritarian regimes have become even less open, transparent, and responsive to their citizens.” Great Britain has now voted to leave the EU; Poland, Hungary, and Israel are heading in illiberal directions; and one of America’s two major political parties is about to nominate a presidential candidate who openly disdains the tolerance that is central to a liberal society, repeatedly expresses racist.

We may think our liberal values are universally valid, but sometimes other values will trump them (no pun intended). Such traditional sentiments will loom especially large when social change is rapid and unpredictable, and especially when once-homogeneous societies are forced to incorporate and assimilate people whose backgrounds are different and have to do so within a short span of time. Liberals can talk all they want about the importance of tolerance and the virtues of multiculturalism (and I happen to agree with them), but the reality is that blending cultures within a single polity has never been smooth or simple. The resulting tensions provide ample grist for populist leaders who promise to defend “traditional” values (or “make the country great again”). Nostalgia ain’t what it used to be, but it can still be a formidable political trope.

Most important of all, liberal societies are in trouble today because they are vulnerable to being hijacked by groups or individuals who take advantage of the very freedoms upon which liberal societies are based. As Donald Trump has been proving all year (and as Jean-Marie Le Pen, Recep Erdogan, Geert Wilders, and other political entrepreneurs have shown in the past), leaders or movements whose commitment to liberal principles is at best skin-deep can take advantage of the principles of open society and use it to rally a popular following. And there is nothing about a democratic order that ensures such efforts will invariably fail.

Deep down, I think this explains why so many people in the United States and in Europe are desperate to keep Uncle Sam fully engaged in Europe. It’s not so much the fear of a declining but assertive Russia; it’s their fear of Europe itself. Liberals want Europe to remain peaceful, tolerant, democratic and embedded within the EU framework, and they’d like to pull countries like Georgia or Ukraine more fully into Europe’s democratic circle eventually. But deep down, they just don’t trust the Europeans to manage this situation, and they fear it will all go south if the “American pacifier” is removed. For all of liberalism’s supposed virtues, at the end of the day its defenders cannot shake the suspicion that its European version is so delicate that it requires indefinite American support. Who knows? Maybe they’re right. But unless you think the United States has infinite resources and a limitless willingness to subsidize other wealthy states’ defenses, then the question is: what other global priorities are liberals prepared to sacrifice in order to preserve what’s left of the European order?

Stephen M. Walt is the Robert and Renée Belfer professor of international relations at Harvard University.

Stocks are already settling down. Maybe people realize that Britain could become a free-trade model.

By Robert Greifeld

Financial traders in London, June 24, the day results came in for the U.K. referendum on EU membership. Photo: Bloomberg NewsOn Friday morning last week, Alan Greenspan, the typically unruffled former chairman of the Federal Reserve, declared the Brexit vote “the worst period I recall since I’ve been in public service”—the 1987 crash included. A prominent London-based trader fretted: “this is as big as 2008 and has the potential to be even bigger.”These dire predictions came against the backdrop of falling markets world-wide. The day the Brexit result was announced, Japan’s Nikkei dropped 8%, but it recovered 4% this week. France’s CAC fell 10% in the first two trading days but is up 5% since Monday. In the U.S., the S&P 500 lost 5% in two days but has rebounded 3%. The NasdaqNDAQ2.38% Composite shed 6% by Monday’s close, only to regain 4%. The declines might seem dramatic, but the past week of trading simply puts the U.S. markets back where they were three months ago.

Investors would do well to recall market overreactions from the recent past. During the 2013 taper tantrum, the S&P 500 dropped nearly 5% and then recovered the entire amount in 10 trading days. The China growth crisis at the beginning of this year caused the Dow Jones Industrial Average to fall more than 11%, followed by a full recovery within seven weeks. The Greek debt referendum in 2015 caused an almost 12% pullback in the Nasdaq Composite, which recovered in nine weeks.In the wake of Britain’s vote to leave the EU, there is good reason for measured optimism. A business trip that took me to China, New Zealand and Australia earlier this month led to some surprising findings. While Brexit was top of mind at every meeting, and the prevailing wisdom was that the United Kingdom would stick by the EU, there was also a palpable excitement that an exit vote could open doors to new trade with an independent Britain. The promise of the European Union was in part increased trading among members of the bloc. However, British dependence on trade with the EU is at a record low and falling. The proportion of U.K. exports headed to the EU has dropped to roughly 45% in 2014 from 55% in 1999. Exports of goods and services to countries outside of Europe have risen steadily.

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After Brexit there is good reason to believe that the U.K. will have the leverage to expand on this trend. Over the next two years, the timeline for EU withdrawal, Britain has an opportunity to become a trading magnet for countries in the EU and beyond. An independent U.K. will be free of the fiscal and regulatory costs of the EU and could cut or even eliminate tariffs while developing a new, vastly simplified regulatory approach. The strategy has been set with this referendum. Now the focus should be on executing the strategy to move new trade agreements forward.Success could embolden the EU to take a similar tack to ensure that it remains competitive and maximizes trading opportunities for its members. This is an opportunity for the EU and U.K. to set a new global trading standard. While many observers are focused on the isolationist political views of those who voted in favor of exit, the ultimate result could be the opposite: a model for free trade in the 21st century that is embraced by the U.K. and across Europe.Positive global tailwinds will help the U.K. negotiate its new reality: Markets are resilient. Most developed economies are growing, albeit modestly. Less-developed countries have grown to nearly half of world trade in 2012 from a third in 2000. Free trade is on the right side of history. Britain’s longstanding relationships and strong trading record will not be easily broken. None of this guarantees success, and an independent U.K. may fail to achieve these possibilities. But smart investors shouldn’t discount Britain’s chances. One thing to expect, regardless of the long-term outcome, is continued short-term market volatility. But this should not be cause for panic. Markets have absorbed the shock of the Brexit vote extremely well. While prices have dropped, liquidity is strong. On Friday trading volume spiked to two times normal on Nasdaq’s Copenhagen and U.S. equity markets, and to 10 times normal on our U.S. Treasury market. These signs of resilience should raise confidence in the health of the markets—and the prospects for enduring strength as this uncertainty is sorted out.The Brexit vote thrusts markets into uncharted waters. No one can say with certainty how this unprecedented move will ultimately play out. But let’s acknowledge that a newly independent U.K. has an opportunity to achieve a positive outcome for itself and broader Europe. Mr. Greifeld is the CEO of Nasdaq.

The unexpected plays out in politics, economics, and the stock and bond markets

By Randall W. Forsyth

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Photo: Peter Foley/Bloomberg

What a year this has been, and it’s only half over.

It seems an eternity ago, in the dead of winter, when we were witnessing the scrums advertised as political debates. From which emerged the presumptive candidates for the Republicans and the Democrats, both of whom are distinguished for eliciting strong passions—mainly negative on the part of their respective opponent’s supporters.

And if published reports are correct, both of the likely candidates now seem intent on choosing running mates who are at least as polarizing. All of which has happened before the conventions and then the seemingly endless general-election campaign—even longer than the baseball season, which now stretches almost to November.

It also seems ages ago that the big global concern for the financial markets centered in Asia, especially China. The seeming exodus of capital from there unsettled currency, credit, and commodity markets. Of the last, oil seemed to be in a virtual free fall with no bottom in sight, dragging down highly leveraged companies that had tapped the junk-bond market for cheap capital when bullishness reigned about the U.S. energy revolution.

Confident predictions of higher interest rates also seem a distant memory—even though they are the finance and economics world’s version of Groundhog Day, recurring every year. Four rate hikes by the Federal Reserve supposedly were in the cards, thus making bonds sure losers, especially those with lengthy maturities. And then there was the seemingly perennial prognostication of TINA—There Is No Alternative to stocks. In a world where cash returns nothing and bonds yield little more, equities were the only source of return.

While the politics remain uncertain, both as to who might be residing in the White House next January as well as which party will control the Senate, the financial expectations have been thoroughly confounded.

The global shock didn’t emanate from Asia, but from Europe, sort of—from the United Kingdom’s vote last month to withdraw from the European Union. And while the Brexit shock initially sliced some $3 trillion from global equity values in the two trading sessions following the June 23 referendum, the rebound has been just as extreme. Indeed, U.S. markets had their best week since last November, and the major U.S. equity averages once again hover within a few percent of their records heading into the U.S. Independence Day holiday. At the same time, bond yields fell to record lows, not just for U.S. Treasuries but for other sovereign bonds, as well. To be sure, the respective moves in the debt and equity markets aren’t unrelated.

The relentless decline in bond yields has provided the wind beneath the wings of the stock market to keep prices aloft.

A perusal of returns for the first half shows an investment world turned upside down. Investors have been turning to stocks for income, while bonds have been the biggest source of capital gains.

With dividends included, the Standard & Poor’s 500 index returned 3.84% in the year’s first six months, according to Bianco Research. Meanwhile, the Treasury’s benchmark 10-year note returned roughly twice that, 7.97%, and the 30-year bond returned more than four times as much, 16.93%—its third-best start of the year on record. Even dowdy municipal bonds did better than stocks, with a 4.33% return.

Within the U.S. equity market, the biggest winners have been the stocks that looked and felt like bonds, such as utilities, telecoms, and consumer staples, providing dividend income, but little if any growth, at steep valuations. Again, that’s a refrain that has been heard before but somehow doesn’t deter investors’ seeking income and stability in a market where both are scarce.

The junk-bond market, battered by its energy exposure, came roaring back with a 9.06% return for the first half, and 16.03% for dicier debts rated Caa. Notable laggards were convertible securities, with a 2.14% return, which suggests better opportunities ahead (see Current Yield).

But the real place to be was Brazil; that is, its stock market, not necessarily the physical location, given the threats from Zika, pollution, and crime ahead of this summer’s Olympics. In a true worst-to-first performance, Brazilian shares returned 46.34%, measured in dollars, vastly better than the 18.51% in local-currency terms as a result of the real’s rebound in the face of recession, inflation, and political upheaval.

Russia was another big winner, gaining 20.43% in dollar terms, more than double the 8.19% in rubles.

This shows how currencies count for investors, often more than what stocks themselves do in local markets. Following the Brexit vote, U.K. shares rebounded with other markets. The pound suffered a record decline, to about $1.32 after touching $1.50 when the initial, errant indications showed the vote would be to remain in the EU.

For the first half, U.K. stocks returned 6.89% in sterling, but in dollars they were down 3.05%—a difference of nearly 10 percentage points. The lower pound served as a shock absorber for the U.K. economy, especially with Bank of England Governor Mark Carney signaling interest-rate cuts to cushion the uncertainty resulting from Brexit. Hit hard were investors in U.K. assets who keep score in dollars or other currencies. Ditto Brits, who face a surge in inflation from higher import costs—long before their nation withdraws from the EU.

For the rest of the world’s financial markets, observes Cliff Noreen, president of Babson Capital Management, the main result from Brexit has been ironically positive. Greater uncertainty has resulted in lower interest rates, which lift asset prices.

ON THAT SCORE, both 10- and 30-year U.S. Treasury securities hit their lowest yields ever, even before Alexander Hamilton was a Broadway sensation or since he was the first U.S. Treasury secretary. According to Tradeweb data cited by The Wall Street Journal, the benchmark 10-year note traded at 1.385% in the wee hours of Friday morning, below the 1.404% closing low of July 24, 2012, during Europe’s debt crisis. The 30-year bond traded at 2.188%, its lowest yield since Jan. 29, 2015, when it was at 2.256%.

As eye-wateringly low as those yields are, they still stand well above those of foreign government bonds. In the midst of Britain’s political and economic upheavals, the 10-year U.K. gilt’s yield slid below 1%, to 0.873%, at week’s end—far under its level when Britannia ruled the seas and much of the terrestrial world and when the Bank of England managed the globe’s main reserve currency, which was backed by gold.

Yields on bonds of governments of other bygone empires also hit all-time lows, with both Italy’s and Spain’s 10-year obligations ending on Friday around 1.14%. France offered 14 basis points (0.14%), which at least was still on the plus side of zero. The benchmark 10-year German Bund traded at minus 12 basis points, while the comparable Japanese security yielded minus 25 basis points.

Bloomberg data passed along by Bianco Research shows that $12.7 trillion—36% of the $35.07 trillion of all sovereign global debt—yielded less than zero, as of June 30, a stat widely noted, but stunning nonetheless. Less noted is that even more, some $14.5 trillion, or 41%, yields zero to 1%, while $5.67 trillion, 16% of the total outstanding, yields 1% to 2%. And just $2.2 trillion, or 6% of sovereign paper, yields more than 2%.

While the Bank of England strongly hinted last week that rate cuts could be coming this summer, prospects for Fed rate hikes faded even further into the distance. Based on Eurodollar futures prices, the U.S. central bank is likely to keep its federal-funds target steady well into next year and perhaps until 2018. (Fed-funds futures don’t actively trade enough that far out to provide a good reading of rate expectations.)

IT IS TAKEN AS A GIVEN that these seemingly preternaturally low interest rates are a result of “financial repression” by global central banks. To be sure, the banks are the main price fixers in what is supposed to be a market economy. But what if zero or less isn’t artificially low? And what if such rates aren’t necessarily a bad thing?

David Ranson, the head of HCWE & Co. and a confirmed iconoclast, takes issue with the widely accepted nostrums about depressed rates. There are mental, cultural, and institutional barriers to negative interest rates, he writes in a paper for the National Center for Policy Analysis. It’s tough to get one’s head around lending money and getting less back. But, he notes, this has happened for some time in Switzerland, where deflation is well established and, much to the surprise of the Swiss, accompanied by a strong currency.

Moreover, in the wake of the global financial crisis, he estimates that U.S. interest rates also should have moved below zero, to take account of commodity deflation.

So, if prices are falling, “it is natural for nominal rates to be negative,” Ranson contends. Still, Fed Vice Chairman Stanley Fischer strongly averred in a televised interview on Friday that the U.S. central bank would seek to avoid negative interest rates. Deferring rate increases now would help ensure that future rate cuts could be avoided. All of which suggests that rates will stay low for longer, maintaining their prop under asset prices, but making it even more difficult for pension funds and insurance companies to generate returns that meet their goals. For the moment, the main focus of the markets and policy makers will be on the June employment report, due out on Friday, even more so than would be usual after May’s dreadfully small 38,000 increase in nonfarm payrolls. A rise of 190,000 is forecast for June. But that’s what was expected for the prior month, too. With markets already on edge, any miss is apt to ramp up volatility.

She's unstoppable that Hillary Clinton - and the American people are going to get what they deserve in allowing 'pure evil' to inhabit the White House - yet again. Because there are other things that are unstoppable as well, like the trend towards accelerating decentralization in the world that unelected central planners (think ECB) and their corporate masters (think Western multinationals) will not be able to thwart forever. We know this to be true due to equally unstoppable trends in now collapsing US sales, ballooning debt, and chronic unemployment that will need to be reconciled after all the hype associated with the election is exhausted, making prospects in the financial markets consistent with historic decennial pattern at extremes.

Of course in the meantime, this leaves prospects for the stock market 'wide open' going into election time, apparently an unstoppable locomotive as well. As warned these past weeks, with the Fed scared silly over the prospect of Hillary not getting into the White House, their determination to engender a 'feel good' effect in stocks to help Hillary's chances should also be considered 'unstoppable', where anybody not heeding such advice is now seriously under water - and it's like to get worse. Again, as discussed last week, one should be watching the 'risk adjusted' S&P 500 (SPX) in measuring such probabilities, where until the S&P 500 (SPX) / CBOE Volatility Index (VIX) Ratio is vexing profound long-term resistance shown here, the bureaucracy's price mangers will most likely remain in charge - making negative bets premature.

Again, next year is likely to be quite a different situation for reasons discussed both above and previously - where if not for 'relief' associated with a cessation to election related hysterics - the manufacture of a second 'cold war' could backfire on US officialdom - especially if Hillary is at the helm. Because the neocons will be both untouchable and unstoppable with the kind of lawless fascism that would grip Washington with this band of moral retards back in the White House, war might not be far off. Push - push - push is the strategy in rebooting the cold war with Russia, China, and their allies - tactics not witnessed since well before the fall of the Berlin Wall. Only thing is this time around both Russia and China are very different foes both militarily and economically.

What Washington group think doesn't realize is China's dependence on exporting is diminishing rapidly as they turn to domestic consumption in feeding the machine, which could (at the right time) cause them to take a real swing back at the US much sooner than Pentagon agencies are presently contemplating. That's why if neocon Hillary wins in November, the US of A could end up in a war they actually don't want, because 'consumerism' depends on continued access to 'cheap goods'. This is why despite what appear to be important factors affecting precious metal prices within the Western sphere may become 'moot' very soon, along with the dollar($), as both hegemonic Globalism and associated trade are profoundly diminished.And if the unraveling of America accelerates under Clinton and her cronies in coming years don't expect to even have an election in 2020 - not that one can call what's happening now 'a href="http://usuncut.com/politics/sanders-says-dnc-rigging-convention/">an election' - because they will have complete totalitarian control in place by then and will not let go until all is lost.Again, as alluded to last week, no matter who is in the White House next January, because Trump is a fraud too (the American way in politics), America will likely resemble a version of Venezuela at some point given its bankrupt as well, just a little behind on the time scale. This is one way of attempting to stop natural process, which again is a disassembling of Globalism, US colonialism, and US$ hegemony, but it's the messy method - one that could spiral well out of control - unstoppable for all involved.This is naturally why we like gold so much going into next year and beyond. Because like the dollar's demise, the flow of funds into precious metals will also be unstoppable at some point (next year) as well. The key here, will be when the bond vigilantes return (it's beginning to happen now), when more of the printed fiat currency units around the world start flowing into the comparatively tiny precious metals market. Right now, precious metals comprise approximately 1% of investor assets globally. Back in 1980, at the peak, this figure was closer to 5%. This means trillions, with a 'T', will need to be plowed into precious metals over the coming five-years or so, into a Fibonacci 21-year apex in 2021. (i.e. the assumption being the bull market commenced in the year 2000.) (See Figure 1)

Figure 1

Technical Note: Just look at those stochastics above. Prices will follow the trend change higher some time later this year. It's 'slow motion', but it's happening. Once the move gets rolling however, it will be unstoppable as those in the know panic out of fixed income, and into precious metals.As you can see above, with gold overlaid (in lime green) over the Gold / USB Ratio, it's all about the sovereign bond market when it comes to the metal of kings (and its underlings), with again, the idea being it doesn't take much of a 'buying power' switch from the huge bond market to the tiny precious metal market in order to have a dramatic effect on prices. What's more, it should be pointed out during the entire bull market in precious metals last decade that public participation rates never exceeded 1%, but still produced approximate 1000% returns in the metals, and 20-fold returns in the shares. So just imagine implications for the sector if participation rates return to peak 1980 levels - some five-times greater than what has already been observed this time around. This is of course why some envision gold well over $10,000, and the shares on Pluto. (i.e. or up at least 20x.) (See Figure 2)

Figure 2

The question of the hour, day, year, decade, century, and millennia is then, just what would spook the bond market enough to counter all the official support it gets, where to give you an idea of what we are talking about, Draghi announced the ECB will be buying corporate bonds now - you know - the private sector crap his buddies peddled. The net result of all the quantitative easing (QE) (both announced and not) is sovereign debt yields worldwide are presently at historic (500-year) lows - levels not previously witnessed by 'modern man'. So, it's going to take something very big to shake this situation up, which is where the acceleration of the new 'cold war' discussed above comes into the picture. Maybe the Fed can buy everything China doesn't.But if a full-fledged trade war erupts, which is the next step, likely to get rolling post election, prices in the states will necessarily need to rise because serious business people will need to raise capital to restart manufacturing State side, which would reveal the lunacy of present Western central bank policy. Again, as discussed previously, and something that is a very big deal not on many radar screens right now, once China gets into the IMF's Special Drawing Rights (SDR) basket in September, they will be in position to broaden policy moves without worrying about US reprisals, which could cause problems for the West in everything from bonds, to stocks, to precious metals. In tandem with all this would be potentially systemic damage to the $ as process unfolds, which would send inflation expectations reeling. (See Figure 3)

Figure 3

Again, in terms of stocks then, while they may catch a bid along with everything else initially as $ troubles accelerate due to corresponding de-dollarization acceleration with everybody the US has screwed over since Bretton Woods finally waking up (what does the US export of any tangible value except war - the answer is 'not much'), once the tension on the tape is lifted post election (and the Fed's prop desks are out on waivers), things could look quite different. What's more, while stocks may not make it all the way to November, still, one must be wary about getting too negative on them until the sinusoidal in the S&P 500 (SPX) / CBOE Volatility Index (VIX) Ratio is vexed (see above), which with any luck will represent a climax associated with all the considerations discussed above.Right on cue, stocks are correcting into ETF options expiry this coming Friday due to gap extremes between prices and open interest put / call ratios growing to wide, as foreseen last week. So we have the SPX falling back to test the large round number at 2100, and this should also happen to precious metal shares as well for exactly the same reason, possibly causing the GDX, for example, to fall all the way back to the large round number at 20, test this metric as well. It's either that or the large round number at 200 on the HUI will hold again (22 GDX), which is of course where one should buy now given all we know, meaning waiting for a fall to 20 on the GDX could prove to be lost opportunity. Such talk assumes gambler betting practices remain central to price discovery in the coming week, along with the growing risk a Comex default does not become more visible.

And the Brexit vote will likely accelerate all this.Good investing is possible in precious metals.

Equinox, Life Time Fitness and other health clubs are carving out larger workspaces for their members

By Rachel Bachman

Brooklyn Boulders has four U.S. locations, including this one in Somerville, Mass. The company provides workspaces for members near climbing areas. Photo: Caitie McCabe/Brooklyn Boulders

Chantelle Hartshorne’s ideal office space is a lounge area at the Equinox gym in San Francisco’s SoMa neighborhood.Ms. Hartshorne, who works for a company called StyleBee that dispatches hair and makeup services via smartphone app, can hop on an elliptical machine for a quick workout. She can step off to take a phone call. Spending more time at the gym also has helped her make connections for her makeup business.“I’ve gotten some high-profile weddings out of the deal,” Ms. Hartshorne says. “At the end of the day, it’s very strategic to place yourself where your users are.”

Illustration: Jason Raish for The Wall Street journalMore health-club members are doing work where they work out.Sensing a surge of demand, gyms are responding by building or expanding workspaces for members to set up laptops, charge phones and conduct business—sometimes for the entire day. The idea is to keep gym-goers lingering longer and accommodate the rising number of people who work remotely.

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The lounge/workspace at Equinox’s SoMa location is about 1,150 square feet. If it continues to gain popularity, Equinox will expand it to as large as 6,000 square feet, says Aaron Richter, Equinox’s vice president of design.At the Equinox in London’s Kensington neighborhood, “I’ve seen people do full-on job interviews in the lounge,” he says.Equinox, which has 81 locations in the U.S., U.K. and Canada, is creating or enlarging lounge/work areas at several other clubs. It’s also building the spaces into almost all new clubs.

Chantelle Hartshorne, who works for an app that provides on-demand hair and makeup services, often does work at Equinox gyms, including this one in San Francisco’s Marina District. Photo: Steven GregoryHealth-club operators say providing workspaces gives members another reason to keep paying dues. It also increases members’ spending on discretionary items like smoothies, yoga pants and massages.About 2.8% of U.S. employees consider home their primary place of work, according to 2014 census data. But 20% to 30% of employees work outside the office at least once a month, and that share is rising, says Kate Lister, president of San Diego-based Global Workplace Analytics.In the 1980s, some high-end health clubs built conference rooms for members, but they never caught on, says Steve Datte, a health-club industry veteran and a regional manager of national health-club chain Wellbridge. More recently, employers have become more open to letting people work remotely, and technology has made it easier.Brittany Frain, a 31-year-old account manager for a job-search company, spends as many as 25 hours a week working in a lounge area of the Colorado Athletic Club in Denver’s LoDo neighborhood. She usually sits at a table near the gym’s weightlifting area.The workspace has strong Wi-Fi, plenty of outlets and USB ports. There’s free coffee from a local company in the mornings. For quitting time, the club’s cafe sells eight craft beers.Sometimes when Ms. Frain is there videoconferencing, the caller will ask, “ ‘What’s going on in the background?’ and they’ll see someone lifting,” Ms. Frain says. “It’s actually kind of a nice little icebreaker. They kind of get a kick out of seeing someone deadlifting behind me when I’m talking to them.”

She says she likes the ambient noise and energy of working at the gym, as opposed to at a coffee shop where she feels she’s disturbing people when she makes phone calls.Since starting her work routine a few months ago, she’s gone from taking group-fitness classes about three days a week to five days.“Getting to the gym is 90% of the battle,” Ms. Frain says. Tom Horne, the club’s general manager, says the lounge and cafe areas are part of the club’s strategy to lure people away from specialty fitness studios. “I almost start all my tours in the cafe, because it gets people’s minds thinking, ‘This place is different,’” Mr. Horne says.Life Time Fitness, a 121-club chain based in Chanhassen, Minn., has a location in downtown Minneapolis with two conference rooms for members. Its gym in Tampa, Fla., has a business center. In other locations, such as the recently opened one on New York City’s West Side, Life Time is installing or adding high-top tables to accommodate people who want to do work.Life Time’s 300,000-square-foot location in the Minneapolis suburb of St. Louis Park has seen a recent surge in members using its cafe and a nearby seating area for work, says Kerry Sutherland, the club’s senior general manager.

The recently opened Colorado Athletic Club in Denver’s LoDo neighborhood features a lounge and workspace that Brittany Frain uses almost daily. Ms. Frain says working at the gym spurs her to take fitness classes more often. Photo: Brittany FrainCoffee shops and health clubs have long aspired to be the “third place” people go after home and work. “Now, people are taking that third place and turning it into their second place,” he says. Joe Lemay, already a member of a rock-climbing and fitness facility called Brooklyn Boulders in Somerville, Mass., began spending his days at a dedicated workspace inside the gym. Dressed in athletic gear, he would tap out computer code at a stand-up desk, then take a break and scramble up the climbing wall.After one climbing session in December 2014, a product idea came to him in a eureka moment: a reusable pen-and-paper notebook that’s digitally interactive. His new company, called Rocketbook, shipped its first notebooks late in 2015.“Having that separation between work and play just doesn’t make as much sense in today’s creative economy,” Mr. Lemay says.Mr. Lemay’s company now has eight employees and operates out of a conventional co-working space while he looks for a permanent office. He says he misses working at the climbing gym, where he didn’t feel odd doing a quick leg stretch at his desk. He noted that traditional co-working companies can charge $500 a month for an office space and a few other amenities, while Brooklyn Boulders gave him workspace and gym facilities for about $100.

If you know the other and know yourself, you need not fear the result of a hundred battles.

Sun Tzu

We are travelers on a cosmic journey, stardust, swirling and dancing in the eddies and whirlpools of infinity. Life is eternal. We have stopped for a moment to encounter each other, to meet, to love, to share.This is a precious moment. It is a little parenthesis in eternity.